In real estate investing, whether you use a dedicated bank account directly affects cash flow visibility and tax risk. This article explains the opening requirements and practical management rules as of 2025.

1. Why a Dedicated Account Matters

Mixing rent income with personal spending makes profit tracking inaccurate and complicates expense classification for tax filing. Once annual rent exceeds 3 million yen, transaction volume often overwhelms a personal account. A dedicated account clearly separates rent loan payments management fees and taxes.

2. Individual vs Corporate Account Requirements

Individual accounts usually require only identification and a registered seal, but banks may still request business use disclosure.

Corporate accounts require a certificate of incorporation articles of association and representative identification. Opening typically takes 2 weeks to 1 month. Some banks decline applications when no clear operating activity is confirmed.

3. Should You Separate Inflow and Loan Accounts

Separating the loan payment account from the rent collection account enables early detection of cash shortfalls. For example, with a monthly loan of 120000 yen and rent of 180000 yen, the true operating surplus is 60000 yen. By letting this surplus remain in a separate account, funds for repairs and tax payments accumulate automatically.

4. Practical Cash Flow Example

Assume two condominium units with total monthly rent of 320000 yen and total monthly loan payments of 210000 yen. Rent flows into the income account at 320000 yen, then 210000 yen is transferred automatically to the loan account. The remaining 110000 yen covers management fees reserves and prorated property tax. This structure allows you to see real cash position instantly without opening accounting records.

Takeaway

For stable operations, a dedicated bank account is essential for both cash control and taxation. Even at an annual scale above 3 million yen, the benefits of separation are significant. Splitting rent inflow and loan outflow with automatic transfers builds the foundation for long term stable property management.